EU to unveil tough climate rules, with tax on foreign firms

EU to unveil tough climate rules, with tax on foreign firms

The Europian Union on Wednesday is unveiling sweeping new legislation to help meet its pledge to cut emissions of the gases that cause global warming by 55 percent over this decade, including a controversial plan to tax foreign companies for the pollution they casue.

The proposal by the European Commission,which is the EU's executive branch,will cover everything from tougher caps on car pollution to new national limits on gases from buildings.It will see a revamp of the bloc's emissions trading scheme under which companies pay for the gases they send into air.

The new legislation will involve around a dozen major proposals- most of them building on laws already in place to meet EU's old goal of 40 percent cut in gas emissions by 2030,compared to 1900 levels- and must be endorsed by the 27 member countries and EU lawmakers.

World leaders agreed six years ago in Paris to keep the global warming increase to below 2 degrees Celsius,and ideally no more than 1.5 degree Celsius by the end of the century. Scientists say both goals will be missed by a wide margin unless drastic steps are taken to begin cutting greenhouse gas emissions.

The aim of the "Fit for 55" legislation,commission officials say, is to ween the continent off fossil fuels and take better care of the environment by policy design, rather than be forced into desperate measures at some future climatic tipping point.

Among the most controversial elements is a plan for a "Carbon Border Adjustment Mechanism". It will impose duties on foreign companies ,and so increase the price of certain goods,notably steel products. The aim is to ease pressure on European producers that cut emissions but struggle to compete with importers that don't have the same environmental restrictions.

In the end, the burden falls on the EU to conform to the World Trade Organization rules of open and free trade, while defending its Carbon tax policy which tends to implement protectionist measure to the global trade.


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